Glasgow City Council and Wheatley Group agree £2.7bn joint venture

Glasgow City Council leader Frank McAveety said the 30-year joint venture between the council and the Glasgow Housing Association (GHA) parent group will secure around 2,000 jobs and more than 2,000 apprenticeships for decades

Glasgow City Council has agreed a new £2.7 billion repairs and maintenance joint venture with social housing landlord Wheatley Group it says will secures thousands of jobs for decades.

Glasgow City Council leader Frank McAveety said the joint venture, which will see Wheatley Group take a 50 per cent stake in the council's arms-length construction firm City Building Glasgow, will secure around 2,000 jobs and more than 2,000 apprenticeships for decades.

Wheatley Group was formed in 2012 and comprises Glasgow Housing Association, Cube Housing Association, YourPlace Property Management and Lowther Homes, all of which were previously and informally known as ‘the GHA Family’ as well as West Lothian Housing Partnership and Dunedin Canmore Housing Ltd.

The group issued a £300 million, 30-year public bond in 2014 – a first for a Scottish housing group – to fund a development programme of 2,800 new affordable homes across Central Scotland.

Wheatley Group operates across 12 local authority areas and owns and manages 72,000 homes.

The new deal will see Wheatley Group and Glasgow City Council each take a 50 per cent share of City Building Glasgow, becoming partners and joint owners.

City Building currently employs around 2,200 people and generates annual turnover of around £200 million.

City Building's repairs contract with Wheatley Group was due for renewal in 2018 but will now be replaced by the new joint venture, which is expected to become operational next year.

The tie-up with see City Building carry out all GHA repair work through a £33 million-a-year repairs service for Wheatley as well as doing the council's own repairs, worth £30 million annually.

The partnership will also take charge of GHA's £27 million annual capital investment programme.

Mr McAveety said: “This deal provides security of employment for the existing workforce of more than 2,000.

“They were facing a tendering process which would have created an incredible level of uncertainty and this secures that long-term.

“It's £2.7 billion to benefit the Glasgow economy.

“It's a chance to maintain a top-quality apprenticeship programme and continue to offer supported employment for people with disabilities.

“This is a real chance to show that apprenticeships are still available in the city of Glasgow.

“The repairs work currently has a 93 per cent satisfaction rate.

“People are happy with the work being done and we want to make sure that continues in the future and combining City Building with GHA we're really putting together the big organisations to do exactly that.”

Gordon Sloan, GHA chairman and a director of Wheatley Group, said: “This secures the repairs contract for the next 30 years and it means we no longer need to go out to tender, and the expense and uncertainty of tendering.

“It's a very positive development for tenants, they will know who is doing their work and the quality of the work, which is so high at the moment.

“From the tenant's point of view, there won't be a drop in quality and hopefully a seamless transition.”